Board says it's too late to fix budget mistake

February 12, 2012|Mark Pearlstein | Condo Adviser

Q: Our board sent the owners a proposed 2012 budget 30 days before the directors met to discuss and approve the budget. The proposed budget had a couple of errors that would reduce the amount of an assessment increase.

Management agreed that it had made the errors but refused to correct them, saying they would have to make new copies of the corrected budget and send them out to unit owners again 30 days before the board would meet again to approve the new budget.

Do corrections to a proposed budget require a new 30-day waiting period before approval? Wouldn't posting a notice explaining the corrections be sufficient?

A: The board is not required to republish the budget and set a new board meeting date for adoption. Although Section 18(a)(6) of the Illinois Condominium Property Act requires owners to receive a copy of the budget 30 days before adoption, the purpose of this extended period is for both directors and owners to review and comment on the budget. If the corrected budget does not result in an assessment increase, the board can distribute a revised budget to the owners after formal adoption. The board should distribute the revised budget by mail or hand delivery as required by law.

Q: At our recent annual meeting and election of board members, one director nominated a single slate of officers for president, vice president, secretary and treasurer. Another board member wanted to nominate a director not on the slate for vice president. This director was told that his nomination was not possible until the entire board voted on the slate. A director cited the rules of the association. No nominations were allowed from the owners attending the meeting, as the nominations were closed after the acting president rejected the vice president nomination.

I find this conduct to be illegal or, at least, immoral. What are the remedies, if any, to reopen nominations after this election?

A: The election of each officer by the board should be voted separately. The Condominium Act calls for the election of three officers from among the board, and I assume your bylaws designate separate offices. I am not aware of any rule that authorizes the election of a slate of officers by the directors. Section 46 of Robert's Rules of Order prescribes the election of each officer separately.

The unit owners do not vote on the election of officers. Your annual meeting was adjourned, and the board, presumably, held a separate meeting to elect officers from among the directors.

Q: I am part of a 200-unit condominium, and word is out that a board member is not current on his assessments. The report is that he pays part of his assessment each month. Can he be removed from the board? Our elections will be held soon. Is he disqualified from holding a seat on the board?

A: The only basis to remove a director is by a vote of the owners. Most association bylaws require a two-thirds vote of the entire ownership to remove a board member. This director is not disqualified from seeking election to the board. Board members may ask the individual to resign but may not force his resignation.

Q: One of the units in our 40-unit condominium is in foreclosure. The owners' assessments are four months delinquent. The owners have returned to a foreign country but have a lawyer dealing with the disposition of the unit. It appears that this matter may drag on for a while.

The unit comes with a much-desired parking space. Can our association arrange with the lawyer to have another resident rent the space on a month-to-month basis, with the rent going to the association to help offset the delinquency?

A: Yes, the board can enter into a voluntary agreement with the owners' representative to lease the space. However, until the board gets a formal order of possession for the unit and the space, the agreement may not be enforceable. If the owners' attorney favors this arrangement, it is practical for the board to proceed with this so-called rent assignment and collect any money available from a month-to-month lease.